Tradition meets Digitization: Story of People’s Bank and JIT Group

“Everything that you do, from Facebook, hotel bookings, happens via this. It’s your life partner. As a bank if you don’t have your services through this channel, then there’s no digitization,” said Sandalal Edirisinghe – Head of IT at People’s Bank. Currently, the bank has embarked on a drive to digitize its operations with the support of the Just In Time Group.

Sandalal Edirisinghe – Head of IT at People’s Bank

To that end, it’s implemented everything from the traditional cash deposit machines and ATM’s to allowing you to letting you open an account without visiting the bank. But according to Sandalal this is merely the beginning. The bank has a holistic vision to capture the new opportunities presented by fin-techs. But how did it embark on this journey?

It all began 3 years ago

People’s Bank has 10 million customers across Sri Lanka with many of them living in rural areas. With this strong base, the bank embarked on a digitization strategy for two reasons. The first was to help bridge the digital divide and allow rural communities to utilize more banking services. The second was to engage with younger generations.

Sandalal elaborated saying, “We’re a traditional bank that’s over 60 years old. So how do we engage with our customer’s children? That was the other angle for us. It was clear to us that the younger generations wouldn’t follow the traditional rules of banking.”

These were the two key reasons that Sandalal pointed out to convince the management to pursue a digital strategy. He describes the challenge saying, “Three years ago, everybody thought digital is just a fancy phone or nice wallpaper on a computer. Nothing more, nothing less.” This is the challenge presented by legacy leadership.

The concept refers to the board of directors and others in corporate leadership positions lacking digital literacy. Despite the challenge, Sandalal made a strong argument that helped convince the rest of the bank. With their approval, work began to bring about the digital transformation of People’s Bank.

Finding the right partner

Once the board was convinced, Sandalal began looking for the right partner that could support People’s Bank on this journey. This partner would be the one that provided the bank with the necessary platforms to provide their services digitally. Ultimately, People’s Bank decided to work with Silver Digital Economy and Just in Time Group as its partners to drive its digitization efforts.

This was because the Just in Time Group was already supplying the technology that powered the core banking system of People’s Bank. Chrishan Mendis – CEO of the Just in Time Group shared that this relationship began 19 years ago. This was when the company sold computers to the bank. Since then Just In Time Group has been supplying many technologies including the recent digital banking Silverlake platform which it supports

Chrishan Mendis – CEO of the Just In Time Group

“Our strength is in understanding our customers. We’ve been in the solution business for a long time. So it’s about identifying a pain point and offering the correct solution,” said Chrishan. And when People’s Bank embarked on digitization, Just in Time offered the solution with the right platform in the eyes of the bank.

Sandalal went onto explain this decision saying, “If the platform couldn’t communicate with our core banking system, then the journey would’ve been very difficult. Luckily, Just in Time offered us a platform that could be seamlessly integrated into our core banking system. We very much need a platform like that to enable our services from the backend to the frontend.”

Building the necessary infrastructure

Yet, despite Just in Time Group offering the right platform, digitizing People’s Bank wasn’t something that’d happen overnight. “It’s not simply bringing a platform and plug it in,” said Chrishan. The bank’s entire digitization process took 3 and a half years. While it took one year to deploy the system, two and a half years were spent on work to ensure the deployment went smoothly.

Sandalal then shared with us that digitizing each service of People’s Bank was a monumental task. Each time, this involved 100’s of people from the bank, Just in Time Group, Silverlake, and many more. There were countless discussions that took place between these people. This was because the businesses processes behind these services had to operate smoothly once digitized.

It took 3 years to make this digital branch of People’s Bank a reality (Image credits: Sri Lankan Mirror)

As such, there were many customizations made to the platform. But these customizations were necessary not only to digitize the banks existing processes. But also its future processes according to Chrishan because, “Once the right platform is in place, things become faster.”

Alongside these customizations, there was also the need for infrastructure. Furthermore, People’s Bank was one of the largest banks in the country. As such, it had to go through a tender process of procurement. Once the tenders were approved and the hardware was acquired, it needed to be operational.

Ensuring this went smoothly was the task of the Just in Time support team that works alongside the People’s Bank IT department. Chrishan tells us that this is a common trait of Just in Time Group for projects with mission-critical timing. Sandalal credits the Just In Time Group support team for ensuring the bank’s digital platform works flawlessly. But setting up hardware and customizing software isn’t the only task of this team.

Digital transformation means everything changes

“Our existing businesses processes had to change,” said Sandalal. Digital transformation isn’t simply creating apps that offer services. Ultimately, it reshapes the entire business. Thus, the Just In Time support team was tasked with what Chrishan describes as, “facilitating a mindset change,” to bring about digitization.

The People’s Bank Digital Agents helping a customer set up an account (Image credits: People’s Bank)

For People’s Bank, this meant disrupting and changing the role of the branch itself. Currently, they have 150 digital branches across the country. Each of these branches is now staffed with 3 digital agents. Their task is to onboard customers and gives loans. They can do this either by visiting customers with a tablet or at the branch itself.

When asked about the role of the branch in a digital world, Sandalal believes they will become investment centers. They would become places where people can receive serious financial advice. This can range from seeking loans to build a house, starting a business, or simple investment advice. Whereas the existing day to day tasks such as cash deposits, fund transfers, and bill payments would be taken over by digital channels.

Sandalal believes these self-banking units will take over the traditional roles of the branch (Image credits: People’s Bank)

But to achieve this Chrishan shared, “We needed to do a lot of training to help the front-end staff understand. They needed to understand the benefits and how their roles are changing. There’s no fear of losing jobs. But there’ll be a huge impact and change when facing the customers.” As such, the digital support team has held a series of workshops at People’s Bank.

The goal of these workshops was to train Sandalal’s team. They would then be tasked with training the front-end staff of the organization. Sandalal considers these trainings to be effective. But the workshops won’t end anytime soon. “We need to go back and apply day to day learnings,” he says reflecting the need for businesses to quickly adapt in the digital world.

The impact of digitization on People’s Bank

When asked about how big an impact going digital had on People’s Bank, Sandalal proudly states, “Our teller traffic has reduced by 60%!” He goes onto explain that previously people lined up at tellers to pay bills, make deposits, and transfer funds. But now the Cash Deposit Machines allow customers to make deposits and transfer funds. He added that People’s Bank saw Rs. 30 – 40 million deposits being made through these machines. Meanwhile, bills can be paid ATM’s.

Sandalal then points to the process of opening an account. Typically, this can take 2-3 days he says with multiple forms to fill. He admits that People’s Bank has the same process. But at the digital branches where their digital agents are stationed, it’s a different story entirely. At these digital branches of People’s Bank, all you need is your NIC.

Once you show your NIC, the digital agents capture all your information on a tablet. Then the system creates your account and issues a debit card. After that, you can visit a cash deposit machine to deposit money into your account. You’ll get a text message informing you of your deposit. And then you can go to an ATM to withdraw cash or pay your utility bills.

Sandalal describes this example saying, “Within 10 minutes to 15 minutes you become an end to end customer. You’re accessing your account, paying your bills, and you walk out. Every service is enabled and you only need to bring your NIC. With traditional banking, you need 2 to 3 days. Going forward, you won’t need to come to a branch.”

This is because the People’s Bank mobile app would offer e-statements, fund transfers, and bill payments. “Two weeks from launch, we’ve gotten 150,000 customers,” states Sandalal with regards to the app. He adds that the total value of transactions with the app was at Rs. 7 billion. In comparison, the old SMS service by People’s Bank has 800,000 customers but their transactions were worth only Rs. 1 billion.

Engaging millennials in the era of fintech

Seeing this success, People’s Bank aims to go further with digitization to empower rural communities. “We want to enable farmers and producers to make payments, open their accounts, so they’ll be fully empowered,” said Sandalal. But this isn’t where People’s Bank is looking at to find their next customers. They’re looking at the children of their existing customers in both rural and urban communities across Sri Lanka.

This is why People’s Bank recently opened their first school ATM at Ananda College. It’s designed so that students can save their coins in an account rather than a till at home. “Most of them carry mobile phones today. So they’ll know how much is in their accounts and we can introduce them to financial planning at a young age,” shares Sandalal.

People’s Bank opened its first ATM in a school at Ananda College in October (Image credits: LMD)

He went onto explain that People’s Bank aims to actively be a part of their lives. If they want to seek financial advice or loans when taking decisions like building a house. People’s Bank wants to allow them to do so without having to visit a branch.

Yet in the era, of fin-tech’s, Sandalal admits that they’re keeping a sharp eye as they work towards complete digitization. He considers fin-tech’s to be, “opportunities we need to capture and offer as well.” Hearing this Chrishan described the bank of the future as, “It’ll work around the clock and people will do an amazing amount of transactions wherever they are.”

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Venture Frontier Lanka is bringing experts in entrepreneurship from around the country to cities throughout Sri Lanka to train local entrepreneurs to think differently about the ventures they will start.

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Venture Frontier Lanka is bringing experts in entrepreneurship from around the country to cities throughout Sri Lanka to train local entrepreneurs to think differently about the ventures they will start. A caravan stop consists of different sessions about creating unique ideas for startup ventures and strategies for financing those ideas.

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Early Bird till the 16th of Dec: 20% discount
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Join for a one day workshop where we unchain the collective wisdom and creativity to help each other having a more productive digital nomad new year and build better cooperations for teamwork.

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Karthik ( Associate Director, DTCC & Co-organiser of Hyperledger Chennai Meetup) will be here for the 2nd Hyperledger meetup.
He will share his experience with Hyperledger and Business application of Blockchain